Exam 16: The Demand for Resources

Assume a firm purchases resources a and b under purely competitive conditions and combines these resources to produce X.Product X is sold in a purely competitive market.The MPs of a and b are 6 and 3, respectively, and the prices of a and b are $12 and $6, respectively.If equilibrium exists, the price of X will be

Which of the following occupations is not among the 10 projected fastest-growing U.S.occupations in terms of percentage increases?

(Last Word) The case of ATMs and bank tellers illustrates that

Assume the price of capital falls relative to the price of labor and, as a result, the demand for labor increases.Therefore,

To firms, resource prices are a major part of

The introduction of ATMs in the banking industry illustrates that ATMs

Suppose a firm hires both labor (L) and capital (C) under purely competitive conditions.The price of labor is PL, and that of capital is PC.The marginal product of labor is MPL, and that of capital is MPC.The firm sells its product competitively at a price of PX.Which of the following must pertain if the firm is to minimize the cost of producing any output?

A computer manufacturer's elasticity of demand for labor is not likely to be affected by the

The less the elasticity of product demand, the greater the elasticity of resource demand.

Critics of the marginal productivity theory of income distribution claim that the theory is flawed because of

If two inputs are complementary and employed in fixed proportions, an increase in the price of one input will

Elasticity of resource demand is measured by the

The marginal revenue product of an input in a competitive market decreases as a firm increases the quantity of the input employed because of the

We say that the demand for labor is a derived demand because

If the price of labor increases relative to the price of capital, and as a result the quantity of capital hired increases, the output effect of the price increase is greater than the substitution effect.

The demand for labor would most likely become less inelastic as a result of

The demand curve for labor will most likely increase when the price of a

The elasticity of resource demand will be greater the

The strength of the demand for a resource depends on the following factors, except the

Suppose a firm is hiring resources l and m under purely competitive conditions to produce product Y, which sells for $2 in a purely competitive market.The prices of l and m are $10 and $4, respectively.In equilibrium, the MPs of l and m, respectively, are